Saturday, July 5, 2014

Unit 4: Nobody understands the cloud!


(http://www.computingcloudstorage.com/wp-content/uploads/2013/04/Cloud-Computing-Platforms.jpg, retrieved 7/3/14)

Maybe this video describes how you feel about the cloud…

 

If so, fear not, just read on…
 
In his 2009 article, “Alternative IT Sourcing Strategies: From the Campus to the Cloud,” Philip Goldstein defined “alternative sourcing” as “the range of options institutions have for providing technology services or operating technology functions aside from doing it themselves”.  This initially included traditional outsourcing models where vendors supplied onsite support (Goldstein, 2009).  However, the internet led the way for this presence to move offsite though hosted applications and leased software applications – also known as software as a service (SaaS) (Goldstein, 2009).  The most recent evolution in alternative sourcing is cloud computing.  Cloud computing leverages economies of scale, high speed internet connections, and virtualization in order to allow users to access and manipulate data from any internet connected device.  In the simplest terms, the data that you work with is housed remotely (often in multiple data warehouses) and the applications/software that you need to manipulate that data are also house remotely.  These remote locations are data centers.  Often, data and your application will be stored in multiple data centers.  Because these services run in the cloud, this offers the promise of easier access and scalability.  The below video explains cloud computing using a relatively simple car analogy (Clouddistribution’s, 2010).

Although the concept of cloud computing is appealing, there are drawbacks.  Below we will weigh the advantages and disadvantages of the concept.

Advantages

1.       Cloud services can potentially minimize operational costs

2.       Cloud services can be deployed faster

3.       Cloud services offer consumption-based pricing and capacity on demand

4.       Cloud services, by outsourcing maintenance work, can allow internal IT resources to focus on development, end user customer service, and analytics

5.       Cloud service allow for an easier development of multiyear budgets (as a service model, the liability of hardware failure and unexpected expense is mitigated)

6.       Software stays up-to-date and the upgrade process is easier

7.       The ability to customize is limited (Mahon et al., 2011)

Disadvantages

1.       IT leaders must ensure sufficient service level agreements (SLA) with vendors

2.       IT staff must monitor the performance of SLAs

3.       Not all applications are in the cloud, so integration can be challenging

4.       Service structures are new and not always fully developed

5.       Because the vendor controls the change and upgrade process, change is more forced than managed by the institution

6.       There are few short term work arounds when problems occur

7.       Third party application add-ons can be expensive and wasteful

8.       The ability to customize is limited – also an advantage (Mahon et al., 2011)

9.       A June 2014 study shows a data breach is 3.1x more likely with cloud applications (Ponemon, 2014)
 
One innovator in the space of cloud computing has been Google.  One of the more interesting cloud computing concepts is Google Apps.  Google Apps takes the functionality of a standard office suite (think Microsoft Office) and places it in the cloud.  Not only was the idea of an office productivity suite in the clouds innovative, but initially it was free!  A 2011 graphic listed Google Apps as one of seven disruptive innovations that turned the market upside down (White, 2011).  The infographic in question is below.


In addition to launching apps for personal users in 2006, Google Apps for Business were released in 2007.  A recent Wall Street Journal article estimated that 16.3% of all companies now use Google Apps (King, 2014).  The video below gives you a better idea of how Google Apps work.

 
Google is so invested in the concept of cloud computing that in addition to free apps, Google partnered with several hardware vendors to create Chromebooks.  Effectively, these are laptops that have minimized hardware and little software housed locally.  Rather, Chromebooks depend on data and software resources in the cloud.  Initial reception was mixed for these devices as not everything people want to do can be done in the cloud currently.  These may have been slightly ahead of their time.

Conclusion

Cloud computing as an alternative IT sourcing strategy seems to be trending.  As the capabilities in the cloud expand and as competition drives the price even lower, expect to see more and more transition.  Although data security is a concern, it is likely that new encryption protocols will help this.  Additionally, there are a great deal of people for which data security is not a concern.  For example, although we are sure other MIS groups are desperately hacking away to attempt to uncover this blog a few days early, we have a high tolerance for risk!

 

References
Clayton, Allen (2014, June 6). Nobody understands the cloud. Retrieved on July 5, 2014 from https://www.youtube.com/watch?v=27GgP6BXR6A

Clouddistribution’s (2010, June 21). Cloud Computing (in Plain English). Retrieved on July 1, 2014 from https://www.youtube.com/watch?v=txvGNDnKNWw

Goldstein, P. (2009). Alternative IT Sourcing Strategies: From the Campus to the Cloud. Retrived on July 1, 2014 from https://net.educause.edu/ir/library/pdf/EKF/EKF0905.pdf

Google. (2010, March 4). How Google Apps Work. Retrieved on July 2, 2014 from https://www.youtube.com/watch?v=doHnLiAzQ5M

King, R. (2014, April 30). Office 365 Gains on Google Apps as Microsoft Puts Priority on Cloud. Retrieved on July 2, 2014 from http://blogs.wsj.com/cio/2014/04/30/office-365-gains-on-google-apps-as-microsoft-puts-priority-on-cloud/

Mahon, E., McPherson, M., Vaughan, J., Rowe, T., Pickett, M., Bielec, J. (2011, July 21). Alternative IT Sourcing Strategies: Six Views. Retrieved on July 1, 2014 from http://www.educause.edu/ero/article/alternative-it-sourcing-strategies-six-views

Ponemon (2014, June). Cloud Multiplier Effect on the Cost of a Data Breach. Retrieved on July 2, 2014 from http://www.netskope.com/reports-infographics/data-breach-cloud-multiplier-effect-infographic/

Suhendra, A.  (2013). Cloud Computing Platforms. Retrieved on July 3, 2014 from https://www.google.com/search?q=cloud+computing&espv=2&source=lnms&tbm=isch&sa=X&ei=RZe2U8rOHMmfyATwp4HwCw&sqi=2&ved=0CAcQ_AUoAg&biw=1280&bih=667#facrc=_&imgdii=_&imgrc=UcHAUHln_74WSM%253A%3B52t_Mr5UL6QIqM%3Bhttp%253A%252F%252Fwww.computingcloudstorage.com%252Fwp-content%252Fuploads%252F2013%252F04%252FCloud-Computing-Platforms.jpg%3Bhttp%253A%252F%252Fwww.computingcloudstorage.com%252Fcloud-computing-platforms%252F%3B500%3B375

White, C. (2011, October 9). 7 Disruptive Innovations That Turned Their Markets Upside Down. Retrieved on July 2, 2014 from http://mashable.com/2011/10/09/7-disruptive-innovations/

 

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3 comments:

  1. UnknownJuly 15, 2014 at 1:11 PM

    Jason/Regina/Danielle,

    Great post. I have never seen an IT trend that has created a bigger buzz with such a small portion of the potential users actually understanding the technology as I have with cloud computing. This sourcing strategy has a tremendous amount of upside and many of innovators and early adopters like Etsy and Netflix (http://www.forbes.com/sites/joemckendrick/2012/02/22/6-shining-examples-of-cloud-computing-in-action/), have experienced a tremendous amount of cost savings from the cloud. However, the rest of the technology adaptation curve (early majority, late majority, laggards), have struggled figuring out how cloud computing fits into their business model. Government entities such as the Central Intelligence Agency (CIA) and Department of Defense (DoD) have extremely stringent security requirements and cloud computing has not yet proven that it can meet their necessary level of operations security. Private organizations also have concerns about the security of data collected on proprietary processes. As you mentioned, improved protocols to ensure data security have to be implemented for cloud computing to shift to the right along the technology adoption model. If data security within cloud computing can be tested and verified, it will become a widely accepted IT sourcing strategy.

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  2. UnknownJuly 15, 2014 at 9:13 PM

    Thanks for your post on Cloud computing. It seems to be everywhere these days. The fact that 16.3% of all companies now use Google Apps really says something about the innovation of Cloud computing, as it is difficult and costly for businesses to implement new technologies. Thankfully, as we've learned from our Assignment 4.2, Google has tried to enter the market with relatively low costs to consumers, offering most of their products for free in the beginning.

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  3. UnknownJuly 16, 2014 at 7:54 PM

    Group 3:

    We enjoyed the post and it was great that it connects to the videos we looked at of Professor Christensen. With its Office suite owning the overwhelming share of the market in business use, Microsoft initially seemed to pay little attention or respect to the cloud-based office productivity market thereby allowing Google to establish the dominant position. However, as was seen in your presentation, that market has almost double over a three year period.

    According to Internet Live Stats.com (click here for graphics), roughly 40% of the world, or nearly 3 billion people have access to internet, today. (Internet Live Stats, 2014) In January 2014, eMarketer.com (click here for graphics) predicated that of the 4.6 billion worldwide mobile phone users, 2.2 billion will access the internet at least once per month in 2014 and that number will rise to over 2.3 billion in 2015. (eMarketer Inc., 2014)

    In June 2013, IT research firm Gartner, reported that cloud office suites represented eight percent of the overall office market. Gartner also predicts that a major shift toward cloud office systems will begin by the first half of 2015 and reach 33 percent penetration by 2017 and they estimate this number will grow to 695 million users by 2022, to represent 60 percent (Gartner, 2013).

    Frankly, these are mind-boggling statistics that paint a rather clear picture of the potential and likelihood that consumers will continue to increasingly, demand access to their productivity files from any device, anywhere. Many have run into the issue of needing access to a file at one time or another but, frustratingly, don’t have immediate access to the device on which the file is stored. For those that need collaborative access to files but don’t have the luxury of working from or access to a company or home network, cloud based productivity applications make a lot of sense.

    The convenience of using the cloud is obvious, but we think that a lot of companies that are slower to adopt are concerned about security and reliability. As we have seen in the past however, internal data is not always safe from attack either. In terms of reliability, we think many companies are hesitant to put such a critical tool of everyday business operations in outsourced hands. What are the implications of a server crash or power outage? Are their multiple storage locations to ensure data is always accessible and how is data backed up?

    All of these necessary analyses/concerns slow the adoption rate somewhat, but the recent growth and adoption speaks for itself. Cloud-based productivity is clearly an option that will capture a large share of the market as more and more companies are able to prove the reliability of their services and google will certainly be a major player in this new market.

    Regards,

    Group 4


    References

    eMarketer Inc. (2014). Smartphone Users Worldwide Will Total 1.75 Billion in 2014. eMarketer. Retrieved July 16, 2014, from: http://www.emarketer.com/Article/Smartphone-Users-Worldwide-Will-Total-175-Billion-2014/1010536

    Gartner. (2013). Press Release: Gartner Says Cloud Office Systems Total 8 Percent of the Overall Office Market and Will Rise to 33 Percent by 2017. Gartner Retrieved July 16, 2014, from: http://www.gartner.com/newsroom/id/2514915

    Internet Live Stats. (2014). Internet Users. Internet Live Stats. Retrieved July 16, 2014, from: http://www.internetlivestats.com/internet-users/

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